Financial News

  • 11 February 2014, 0:40

Oz Car Industry Death Knell As Toyota Quits

Toyota has confirmed it will stop making vehicles in Australia, leaving the country with no local car-making ability.

The Japanese firm said it would cease engine and vehicle production by the end of 2017.

The decision has been taken despite appeals by newly-elected Prime Minister Tony Abbott for the continuation of the industry.

Australia has been called the most fragmented vehicle sector in the world, with a small consumer base.

It has a similar population to Taiwan, but spread over a land mass comparable to the continental United States.

The Australian dollar's strength has also worked against local production for foreign firms.

Toyota's announcement throws into doubt 3,900 production jobs in the state of Victoria and another 150 design jobs.

The news comes less than two months after General Motors-owned Holden, considered an iconic marque among Australian car aficionados, said it would also cease local production.

Nearly 3,000 jobs were put at risk by Holden's decision to quit by 2016.

And last May, Ford said it would cease production at its unprofitable factories, with the loss of 1,200 jobs.

"We believed that we should continue producing vehicles in Australia, and Toyota and its workforce here made every effort," said Toyota president Akio Toyoda.

"However, various negative factors such as an extremely competitive market and a strong Australian dollar, together with forecasts of a reduction in the total scale of vehicle production in Australia, have forced us to make this painful decision."

Toyota began making cars in Australia in the early 1960s.

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